Mr D O’Byrne and Others v Luxtripper Ltd (in administration): 3202184/2023 and Others
EMPLOYMENT TRIBUNALS
Case No 3202184/2023
Between
Mr D O’Byrne and OthersClaimantLuxtripper Ltd (in administration)Respondent
Before
Employment Judge G. King
Members
Mrs G. McLaughlinMs A. BerryIn person for claimantNo appearance or representation for respondentDate 6 May 2025
JUDGMENT
[1]The Claimants’ complaints under section 189 TULRCA of failure to consult about collective redundancies are well founded and the Tribunal grants a declaration to that effect. The Tribunal also makes a protective award ordering the Respondent to pay remuneration to the Claimants for a protected period of 90 days beginning on 30 June 2023.[2]The Claimants’ complaints under section 192 TULRCA of failure to pay remuneration under the protective award are well founded. The Tribunal orders the Respondent to pay the amounts set out in Schedule 2.[3]Recoupment of state benefits applies to these claims. The prescribed elements are the sums set out in Schedule 1. The prescribed period is 27 October 2023 to 25 January 2024.[4]In relation to 3202184/2023, the Claimant’s claim of breach of contract in relation to notice pay is well founded and succeeds. The Respondent is ordered to pay the outstanding two weeks’ notice pay in the sum of £1,215.23, subject to deductions for tax and National Insurance.
REASONS
[1]This is a claim by the three Claimants named above for a protective award and for remuneration due under that award. Procedural background[2]The claims were originally brought individually by the Claimants. The Respondent company had gone into administration and did not submit a response to any of the claims.[3]The claims of Mr Pannell and Mr Harrocks were consolidated and a final hearing was set for 9 May 2024. Neither Mr Pannell nor Mr Harrocks attended this hearing, and it subsequently became clear that they had not been sent the correct notification of the hearing.[4]Mr O’Byrne’s claim was also consolidated with that of Mr Pannell and Mr Harrocks, and a date for a final hearing was set for 17 October 2024. This hearing had to be postponed due to lack of judicial resources.[5]The hearing was able to proceed today. The Respondent and the Secretary of State for Business and Trade were not represented at the hearing; the Secretary of State for Business and Trade having informed the Tribunal that this was its intention.
Findings of fact
[6]Having heard from Mr O’Byrne, Mr Pannell and Mr Harrocks, who all gave sworn evidence on behalf of all the Claimants, the Tribunal is satisfied that the following facts are established on the balance of probabilities.[7]The Claimants were all employed by the Respondent company. On 18 October 2023, they were notified that the Respondent was urgently trying to sell the business by Accelerated Merger. The Claimants were informed on 27 October that this attempt had been unsuccessful. The Claimants were informed that they were dismissed with immediate effect. There had been no warning or consultation. There was no recognised trade union, and no employee representatives had been elected. In total, over 60 employees who worked at the same establishment were dismissed.[8]The company has since entered into administration, and the Claimants have received various outstanding payments (including redundancy payments, holiday pay and notice pay) from the Insolvency Service.
Law
[9]Section 188 TULRCA provides, so far as is relevant: ‘(1) Where an employer is proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less, the employer shall consult about the dismissals all the persons who are appropriate representatives of any of the employees who may be affected by the proposed dismissals or may be affected by measures taken in connection with those dismissals. (1A) The consultation shall begin in good time and in any event –(a) where the employer is proposing to dismiss 100 or more employees as mentioned in subsection (1), at least 45 days, and(b) otherwise, at least 30 days, before the first of the dismissals takes effect.’[10]Complaints about a breach of section 188 are brought under section 189, which provides: ‘(1) Where an employer has failed to comply with a requirement of section 188 or section 188A, a complaint may be presented to an Employment Tribunal on that ground –(a) in the case of a failure relating to the election of employee representatives, by any of the affected employees or by any of the employees who have been dismissed as redundant; […] (d) in any other case, by any of the affected employees or by any of the employees who have been dismissed as redundant. (2) If the Tribunal finds the complaint well-founded it shall make a declaration to that effect and may also make a protective award. (3) A protective award is an award in respect of one or more descriptions of employees – (a) who have been dismissed as redundant, or whom it is proposed to dismiss as redundant, and(b) in respect of whose dismissal or proposed dismissal the employer has failed to comply with a requirement of section 188, ordering the employer to pay remuneration for the protected period. (4) The protected period – (a) begins with the date on which the first of the dismissals to which the complaint relates takes effect, or the date of the award, whichever is the earlier, and (b) is of such length as the Tribunal determines to be just and equitable in all the circumstances having regard to the seriousness of the employer's default in complying with any requirement of section 188; but shall not exceed 90 days. (5) An Employment Tribunal shall not consider a complaint under this section unless it is presented to the Tribunal – (a) before the date on which the last of the dismissals to which the complaint relates takes effect, or (b) during the period of three months beginning with that date, or(c) where the Tribunal is satisfied that it was not reasonably practicable for the complaint to be presented during the period of three months, within such further period as it considers reasonable. (6) If on a complaint under this section a question arises – (a) whether there were special circumstances which rendered it not reasonably practicable for the employer to comply with any requirement of section 188, or (b) whether he took all such steps towards compliance with that requirement as were reasonably practicable in those circumstances, it is for the employer to show that there were and that he did.’[11]In Susie Radin Ltd v GMB and ors [2004] ICR 893, the Court of Appeal gave guidance on how Tribunals should exercise their discretion under section 189 TULRCA. It held that the Tribunal has a wide discretion to do what it considers just and equitable, but the focus must be on the seriousness of the employer’s default. The length of the protected period is a matter for the Tribunal, but a proper approach where there has been no consultation is to start with the maximum period of 90 days and reduce it only if there are mitigating circumstances justifying a reduction.[12]If a group of individual Claimants applies to the Tribunal for a protective award, the Tribunal cannot make an award that applies more generally to a class of employees who were affected by the employer’s failure to consult but who are not party to the proceedings – Independent Insurance Co Ltd v Aspinall and anor [2011] ICR 1234, EAT. Employees who find themselves in that position can apply to the Employment Tribunal under rule 34 of the Employment Tribunal Rules of Procedure 2013 to be joined out of time as parties to the case on the basis that they have an interest in the outcome of the proceedings. They can then apply, under rule 70 of the Tribunal Rules, for the Tribunal’s decision to be reviewed in the interests of justice – Harford and ors v Secretary of State for Trade and Industry EAT 0313/07.[13]Entitlement to remuneration under the protective award is addressed by section 190 TULRCA: ‘(1) Where an Employment Tribunal has made a protective award, every employee of a description to which the award relates is entitled, subject to the following provisions and to section 191, to be paid remuneration by his employer for the protected period. (2) The rate of remuneration payable is a week’s pay for each week of the period; and remuneration in respect of a period less than one week shall be calculated by reducing proportionately the amount of a week’s pay. (4) An employee is not entitled to remuneration under a protective award in respect of a period during which he is employed by the employer unless he would be entitled to be paid by the employer in respect of that period –(a) by virtue of his contract of employment, or(b) by virtue of sections 87 to 91 of the Employment Rights Act 1996 (rights of employee in period of notice), if that period fell within the period of notice required to be given by section 86(1) of that Act. (5) Chapter II of Part XIV of the Employment Rights Act 1996 applies with respect to the calculation of a week’s pay for the purposes of this section. The calculation date for the purposes of that Chapter is the date on which the protective award was made or, in the case of an employee who was dismissed before the date on which the protective award was made, the date which by virtue of section 226(5) of that Schedule is the calculation date for the purpose of computing the amount of a redundancy payment in relation to that dismissal (whether or not the employee concerned is entitled to any such payment).’[14]Complaints about an employer’s failure to pay remuneration under a protective award are brought under section 192 TULRCA: ‘(1) An employee may present a complaint to an Employment Tribunal on the ground that he is an employee of a description to which a protective award relates and that his employer has failed, wholly or in part, to pay him remuneration under the award. (2) An Employment Tribunal shall not entertain a complaint under this section unless it is presented to the Tribunal –(a) before the end of the period of three months beginning with the day (or, if the complaint relates to more than one day, the last of the days) in respect of which the complaint is made of failure to pay remuneration, or(b) where the Tribunal is satisfied that it was not reasonably practicable for the complaint to be presented within the period of three months, within such further period as it may consider reasonable. (3) Where the Tribunal finds a complaint under this section well-founded it shall order the employer to pay the complainant the amount of remuneration which it finds is due to him.’ Protective award[15]The Respondent was proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days. Accordingly, collective consultation should have begun at least 30 days before the dismissals took effect – section 188 TULRCA. No collective or individual redundancy consultation took place. There was no recognised trade union, and the Respondent failed to make arrangements for the election of employee representatives. The Claimants are therefore entitled to a protective award.[16]The Respondent did not submit an ET3 and has played no part in these proceedings, having gone into administration. The evidence indicates that the business had been in financial difficulties prior to October 2023, and no explanation has been offered for the failure to consult. In these circumstances, there are no mitigating factors that would justify a reduction in the maximum protected period of 90 days. The Respondent bears the onus under section 189(6) TULRCA of establishing that there were special circumstances that rendered compliance with the duty to consult not reasonably practicable. It has failed to do so. In these circumstances, the Tribunal considers that the just and equitable period for the protective award is the maximum of 90 days, beginning on 27 October 2023 (the date on which the dismissals took effect). Failure to pay remuneration under protective award[17]The procedure for seeking a protective award is usually a two-stage process. First, an application is made for a protective award under section 189. If an award is made, the Claimants may in due course apply to the Employment Tribunal to enforce the award under section 192 and for their entitlement to be ascertained. In this case, however, the two stages were addressed at a single hearing because it is clear that the Respondent is insolvent and is not in a position to pay remuneration under the protective award. It would be pointless and contrary to the overriding objective for the Tribunal to grant a protective award, and to require the Claimants to make a separate application to the Tribunal for remuneration due under that award.[18]It was explained at the hearing that the Claimants are unlikely to recover the full amounts awarded by this Tribunal. Where an employer is insolvent, the Insolvency Service will pay the protective award, but the amount that can be recovered is limited to eight weeks’ pay and capped at £5,144 (for dismissals between 6 April 2023 and 5 April 2024). Furthermore, certain payments (such as outstanding wages) already received from the Insolvency Service will be offset against that sum. Breach of Contract[19]In relation to 3202184/2023, the Tribunal accepts the First Claimant’s evidence that he is contractually entitled to four weeks’ notice pay and only received two. The claim succeeds against the Respondent, but as they are in administration it is unlikely that the First Claimant will be able to recover this amount. Approved by: